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Monday, March 31, 2014

Shifting the tax burden

Canada's Tax Burden Shifting From Corporations Onto People: Economist

For the first time in Canadian history, more than half of the federal government’s revenue in 2014 will come from personal income taxes -- a vivid sign that Canada’s tax burden is slowly shifting away from corporations and onto consumers.It’s the apparent result of successive Liberal and Conservative governments that have cut corporate taxes far more aggressively than they have cut personal income taxes, while increasing “hidden taxes” that mostly impact low-income and middle-income workers.The federal corporate tax rate has been nearly cut in half since 2000 -- from 28 per cent at the turn of the century to 15 per cent in 2012. The Harper government boasts that this will give Canadian corporations the lowest tax rate on new investment of any G7 country.Personal income taxes, on the other hand, have remained at more or less steady levels through this time. The lowest tax bracket, which now applies on incomes below $42,706, has fallen slightly to 15 per cent today from 17 per cent in 2000. The top marginal tax rate has stayed the same, at 29 per cent.